Credit Fund/Direct Lending Salaries 2019

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Bump. Helpful to know, are we talking about funds like Golub / Antares here?

Great question. Would like to know this as well

Sorry to hear that man. Would you mind sharing what size firm and what general location you work in?

Do you work at a MF? If so, could you shed some light on the pay?

What size AUM for this:

Agree with your last point and would even argue that if an investment goes badly they can always sell at 30c:$1, yes it’s a loss but better than lossing everything.

I would say it’s somewhat lighter, but mostly less variable since you have more processes at any one time. Fewer 100 hour weeks, but there’s always something going on. Distressed tends to be more volatile like PE.

HighlyClevered:

PE shops will diligence an investment harder than the credit funds. I can take educated guesses on primary reasons:

Equity investments are, by definition, riskier and should require a more robust investment thesis.

The PE shop may take an active role in operating the company and directing its strategy, wheras the lender is a passive participant.

Credit funds often have longstanding relationships with sponsors, and to an extent they can rely on some of the diligence done by the sponsor rather than duplicating efforts.

And I could be very wrong on this last one, but I assume PE funds are taking fewer, more concentrated bets, while credit funds have greater portfolio diversification.

Also depends on where you are in the debt cap structure.

My firm when we do a 1L at say c. 3.5x leverage on a well diversified business that trades at 10x + will do significantly less diligence than say doing an unsecured mezz piece at say 6.5x on a more concentrated business. Debt is all about principal protection rather than how fast we can grow the business.

Also doing business with repeat sponsors is good because you can generally figure out whether the sponsor is going to be a pain in the ass about putting in more money / taking aggressive moves if the business goes south.

Current banker in the credit space, most investors will do extensive diligence regardless of what we do but this varies by shop. You're correct in that PE funds mostly invest credit along companies that would typically fit their equity mandate, or they do combo debt/equity deals. While some credit funds are more diverse in what they invest in, there are also some that have very specific mandates as well and are much more concentrated.